Supreme Court agrees there is bias in state sales tax proposal

PHOENIX -- Saying a panel of lawmakers acted illegally, the Arizona Supreme Court ruled late Friday that the description they wrote of a proposal to permanently hike the state sales tax by a penny is biased.

The justices upheld a decision by Maricopa County Superior Court Judge John Rea that the Legislative Council, made up of lawmakers, did not comply with legal requirements that they prepare an "impartial' analysis of every measure on the ballot. They said lawmakers need to rewrite the description or remove the offending provisions.

It remains unclear what the committee, dominated by Republicans, will do next.

Senate Majority Leader Andy Biggs, R-Gilbert, questioned the authority of the court to review the wording, much less order a rewrite. He suggested lawmakers should ignore the order.

But Biggs conceded all that would do is force Secretary of State, who is responsible for printing up the brochure with the ballot descriptions, to remove the language the court found wanting.

The fight is crucial because that brochure is mailed to the homes of all registered voters. It can become the basis on which some people decide whether to support or oppose each measure.

Voters approved a temporary one-cent hike in the state's 5.6 percent tax rate in 2010 as part of a plan to deal with a $3 billion deficit. That tax self-destructs on May 31, 2013.

Proposition 204 would impose an entirely new one-cent surcharge, effective June 1. And unlike the existing measure, the proceeds would be earmarked for specific purposes, mainly K-12 education but also health care for children and road construction.

Republican legislative leaders are opposed, as is Gov. Jan Brewer.

The issue arose because the GOP-dominated committee voted to describe the measure as a tax "increase.' Biggs defended the move, saying it is an entirely new tax, pointing out that the rate will return to 5.6 percent automatically if the initiative fails.

Rea said lawmakers could describe the increase only if they put it in context. What that means, he said, is pointing out that if Proposition 204 were to pass, the effective tax rate on June 1 would be no different than the day before.

Supreme Court Justice Scott Bales, writing for his colleagues, said Rea did not abuse his discretion in concluding that the proposed description by the Legislative Council was not impartial. Biggs, however, said none of this is the court's business.

"They're not the ones to judge what the context is,' he said. Biggs said the council was entitled to describe the levy as a tax increase on the 5.6 percent base rate.

"This is just judicial activism at its rankest,' Biggs said.

Rea also ordered -- and the high court approved -- two other changes.

The judge said it was improper for lawmakers to single out the fact that the initiative contains no definition of who is an Arizona resident when explaining that some of the proceeds of the tax would be used to provide scholarships for residents. Rea said it appears the council decided to mention that in a bid to make people think that funds could end up aiding those not in this country legally.

Rea also said the council failed to accurately described what limits the initiative would have on the ability of lawmakers to make future changes to the sales tax system.

In a prepared statement, initiative organizer Ann-Eve Pedersen said the biased description was pushed by "anti-education legislators who want the power to continue cutting education funding.'

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